Saving Money The Lazy Way

By cwaltersNovember 17, 2007

If you’re like approximately 25% of the writers at The Consumerist, then prolonged talk of budgeting makes your eyes glaze over with boredom as you imagine yourself somewhere else doing something fun, like playing a video game or looking at pornography. Here, then, is a list of 10 so-called “easy” ways to save money, none of which require that you read a book or finally open that Quicken box your parents bought you two years ago. Many (or most) of the ideas may be of dubious value, but nobody said being lazy was profitable.

The first half of the list focuses on putting away money, while the second half focuses on bringing more in to begin with:

“1. Automate your savings.” Combining direct deposit with scheduled transfers of cash from your checking to a savings account is a great way to save by accident. If you want to really capitalize on your laziness, choose a savings account at a different institution so that it’s more trouble than it’s worth to transfer back out.

“2. Collect your excess coins.” We do this. When we take our coins to a Commerce Bank coin counting machine, we feel rich, usually by $60-70. We’re not sure how to turn this into “savings” though.

“3. Use goal jars.” The original post says you can label a jar “kids’ education,” but we imagine that would have to be a really huge jar.

“4. Form a budget and stick to it sometimes.” If you can’t follow one the right way, at least use it as a guideline for carving up your expenses.

“5. Eliminate or reduce a hobby or subscription.”

“6. Sell stuff on eBay or Amazon Marketplace.”

“7. Start a new hobby.” More specifically, replace that money-eating hobby from #5 with something you like that can generate a small side income, like repairing computers, making and selling things, or caring for pets. Just don’t make that “hobby” something indescribably absurd, like how our friend’s dad suggested one summer that they grow water lilies in an unused horse trough and sell them to local florists. That’s not a good get-rich-quick scheme; that’s a sign that Daddy’s going crazy.

“8. Ask for a raise.”

“9. Get a second job in retail.” The low wage may make this option seem like a poor use of your time, but if you’ve got too much free time that you’re not doing anything with, this can be a way to convert it to revenue, at least for a while.

“10. Consult.” Hmm. Now we think this blogger is just messing with us.

Comments

Edit Your Comment

Go metal detecting on the beach/lake. I know several retired guys who do this just for fun…. not neccessarily as an income. But they make $ in the process. Modern coins, old coins, silver & gold jewelry (especially with diamonds!) can be spent/sold. And the IRS doesnt have to know about ANY of it! ;)

Note: there are much more finds (gold jewelry possibly with diamonds) below the water in the sand … and the guys with snorkels & underwater metal detectors make more finds than most. Every jamoke with visions of gold & diamonds pound the dry sand , but very few actually go under water to get the good stuff.

#1 is working for me. I was even lazier when I set it up: I had a car loan with my credit union at work, for which I got payroll deduction. I paid off the loan early with a small windfall and never stopped the payroll deduction. I never missed the money and it was amazing how fast it piled up when I wasn’t thinking about it. To help it along I set up an ING Direct account (it pays 4.2% APR as opposed the the credit union’s .5%) and set up an automatic transfer from the credit union account to ING.

#11 Quit buying stupid shit!
There wouldn’t be so much stupid shit in stores if somebody wasn’t buying it! Whee! I got the first #11 post!
I have found I could save a lot of money if I could eliminate my two biggest vices:
1. I like to eat semi-regularly.
2. I like to sleep indoors.

Seriously, don’t buy anything you ‘want’ unless you can afford it. You don’t need a 60″ plasma if you’re a night stocker at KKK-Mart.

Dirtymonkey’s observations about tax-free income from beachcombing aside, if you become a consultant, the IRS **will** know about you, and you **will** have to pay them. There are a lot of tax snares to self-employment, which I will detail below. The point to take away is that extra income has to be pretty lucrative before it’s worth the headache it will cause you when it comes time to pay taxes.

When your employer withholds money from you paycheck they take about 6% for FICA/medicare. What you may not realize is that they match this amount. When you become your own employer, you are required to pay the matching 6% yourself (12% total). You can deduct this amount from your income tax, but it is a small consolation.

Another benefit of the withholding your employer does is that you don’t have to pay your taxes until the end of the year. Your employer pays taxes every quarter. When you become your own employer? Yep, that’s right. If the amount of tax you expect to pay at the end of the year is going to be more than $1000, you are going to have to make quarterly payments. (Side note: because of the way the quarterly payments are calculated, you can avoid paying them the first year you consult). If you fail to correctly pay your quarterly income, you’ll incur additional penalties and interest at the end of the year.

Now that you’re in business for yourself, you have to navigate the shark infested waters of business expense deductions. If you have significant expenses (as a consultant, you probably won’t, except possibly travel and some computers), it can significantly reduce your tax burden. However, some deductions (like the home office deduction) can increase your chances for an audit, so they may not save you enough to be worth the risk.

If that weren’t enough trouble, depending on your location, you may need to register your business with your state or local tax offices. You’ll have similar issues with quarterly payments. In my experience with state and local tax (Pittsburgh, Pennsylvania), I found that these tax your gross income, not your net. That means no (or very few) eligible deductions. Further, the city is on a different quarter system than the state and federal taxes. Note that not all states (e.g. the great state of Texas) have a state income tax.

If your consulting was going to be particularly lucrative, it would probably be worth hiring a tax accountant. You can do it yourself (I did), but it cost me about a week’s worth of time to navigate all the forms and schedules to figure it out, and then a day each quarter to calculate and file my payments.

You’ll still earn more than you pay in taxes, so it can benefit you. The main thing is not to think of money earned consulting on the side as “free” money.

Final disclaimer: I am not a tax accountant. Tax laws change. I might be wrong. Etc. etc. This is mainly account of my experience with the Joys of Consulting.

@kamikasee: Let’s see…
— if you’re consulting part-time and still have withholding at your “regular” job, the easiest way to deal with accounting for a small amount of consulting income is probably just to reduce or eliminate the exemptions on your W4. You could even set the W4 to have more withheld at your regular job in lieu of quarterly estimates. It would be good to occasionally review this, since if you start making a lot of money on your consulting gig you might need to pay more. If you’re in a state-income-tax location, this will be putting more money into your state income tax as well.
–If you don’t get a kick out of doing the accounting on your own, get Quickbooks. It’s deductible from your business expenses and has most of the calculations for tax and such built in.

Another easy way to save is term deposits. Every time you’ve got an extra $1,000 (or whatever your bank’s minimum) lock it in for six months or a year. It will earn interest at a higher rate, it’s locked away so you can’t waste it, but it’s still equity that you can borrow against in case of an emergency.

If you don’t mind not getting interest (or you are willing to gamble on the US-Euro exchange rate getting worse) buy travellers cheques in Euros and put them in a safe deposit box. Given the coming predicted recession and continued drop in the US dollar, it’s not a ludicrous idea.

All that advice is pretty stupid. A budget is a beautiful thing. It greatly increases the pleasure of shopping because when you shop with budgeted and “saved money” (how can I get some of this “saved money”) there is close-to-zero guilt.

I am an avid user of the library, saving me tons of $$$. I also picked up a part time job at a retail store, not only do the extra dollars help with bills and fun stuff, I get a discount on groceries and clothes, electronics, etc. I shopped there anyways so what a bonus!!!